Current Attempts to Define Regulator Roles in Cryptocurrency Enforcement Actions

Active

Program Number

31119

Program Date

2021-07-13

CLE Credits

In March 2021, John McAfee was charged by the DOJ with fraud and money laundering in connection to his cryptocurrency activities in the past few years – specifically his social media statements about cryptocurrencies and purchase and sale of those same cryptocurrencies. In doing so, the DOJ seems to be applying market manipulation laws in a novel way in the crypto space, alleging that McAfee had the ability to manipulate the cryptocurrency market in the same way that stocks can be manipulated in pump-and-dump schemes. This case and the expected upcoming congressional task force on cryptocurrencies are likely to provide the market with much more clarity on how coins and projects will be treated in investigations, including whether they can be treated as securities and the relative roles of the SEC and CFTC. The objectives of this program are to explore why cryptocurrencies are unique and not easily defined using existing regulations, to examine the cases that have thus far defined regulator roles, and to review the pending matters that are likely to provide more insight on how cryptocurrencies can and will be treated in future enforcement actions.